Highlights

• CLS Holdings paid a 2.7p final Dividend in May 2026 but declared no Interim Dividend for the first half.

• EPRA Earnings fell to £10.9 million, or 2.7p per share, from £16.1 million a year earlier.

• Loan-to-value rose to 51.6%, above the 35% to 45% medium-term target range, after valuation falls.

• The company targets about £100 million of disposals in 2026, with £75.7 million completed or exchanged.

A dividend can disappear in a single sentence. For CLS Holdings (LSE:CLI), that sentence was the board's decision to pay nothing at the half-year and consider one final dividend for 2026 instead. With Debt ratios stretched and valuations falling, the payout history now deserves a careful second look.

What was paid

Within the twelve months to 10 November 2026, one ordinary dividend went ex: a 2.7p final on 9 April 2026, paid on 22 May. At a share price of 44.0p, recorded on 13 October 2026, that is a trailing Yield of 6.14%. An interim of 1.3p went ex on 4 September 2025, just before the window opened. For the first half of 2026, there was no interim, against 1.30p in the prior-year period, and the board said it will consider one final dividend covering the whole of 2026.

Policy and cover

The stated policy is to cover the dividend between 1.5 and 3.0 times with EPRA earnings, subject to UK REIT distribution requirements. First-half EPRA earnings were £10.9 million, down 32.3%, equal to 2.7p per share against 4.0p. Management guides to full-year EPRA Earnings Per Share of 4.6p to 5.5p. The statutory loss after tax widened to £69.6 million from £24.4 million, driven by an £84.2 million fall in Investment property values.

Balance sheet and disposals

Loan-to-value rose to 51.6% from 50.0% at December 2025, above the medium-term target of 35% to 45%. The portfolio value fell 4.6% in local currencies, with the UK down 7.2%, Germany down 2.5% and France down 3.7%. The company targets about £100 million of disposals in 2026, of which £75.7 million had been completed or exchanged, with a further £22.5 million under offer. EPRA net tangible assets were expected at 177.7p per share.

Tenants and going concern

The National Crime Agency Lease at Spring Gardens expires at the end of September, the largest tenant departure the company has faced. The accounts also contain a material uncertainty related to going concern, tied to completing refinancings and disposals. Slower-than-expected leasing and yield expansion were cited behind the valuation decline.

How to read the yield

The 6.14% trailing figure reflects one payment only, and a pause in the interim means the forward picture is unclear. Any final dividend for 2026 will be set against the cover policy, full-year earnings guidance of 4.6p to 5.5p per share, and progress with disposals and refinancing.

Why a REIT pause is notable

A real estate investment trust normally distributes most of its rental profit, so a pause in the interim dividend is a significant event. It suggests that the board is giving priority to the balance sheet, particularly with loan-to-value at 51.6%. For CLS Holdings (LSE:CLI), preserving cash can help to refinance debt and complete disposals. Shareholders should read the decision as a sign of caution rather than as a final end to dividends, since the board has said it will consider one final payment for 2026.

Understanding loan-to-value

Loan-to-value compares a company's borrowings with the value of its properties. When property values fall, as they did here, the ratio rises even if debt stays the same. A figure above the target range of 35% to 45% can make lenders more cautious and limit the company's choices. Disposals reduce debt and therefore bring the ratio down, which is why the plan to sell about £100 million of property in 2026 is central to the story.

Going concern and what it means

A material uncertainty related to Going Concern is a statement in the accounts that events or conditions may cast doubt on the company's ability to continue operating without completing certain actions. In this case the actions are refinancings and disposals. It does not mean the company will fail, but it does tell readers that outcomes depend on those steps. Investors in LSE:CLI should follow progress on both.

Liquidity and dealing costs

The ease with which shares can be bought and sold affects the return an investor actually achieves. A wide gap between the buying and selling price, called the spread, adds to the cost, particularly for smaller companies and trusts. Using limit orders can help to control the price paid. Investors should also check how many shares typically change hands each day.

What to watch next

The expiry of the lease at Spring Gardens, further sales and the refinancing timetable will shape the second half. The board's decision on a final dividend will be set against the cover policy and full-year earnings of 4.6p to 5.5p per share. Until that decision is announced, the 6.14% trailing yield reflects one payment only.